Islamic banking continues to show rapid expansion

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Economic Reporter :The investment with the Islamic banking accounts increased by 17.05 percent at end of the April-June quarter of 2018 compared to the corresponding period of the preceding year, 2017."Among different segments of Bangladesh's Islamic finance Industry, the Islamic banking industry is dominating. The Islamic banking segment continued to show rapid expansion in terms of growth of assets, deposits, investments and number of account holders," a Bangladesh Bank (BB) senior official told this correspondent on Sunday.According to the BB latest data, the total investments (loans in conventional sense) in Islamic banking sector stood at Taka 2,16,827.43 crore at the end of April-June 2018 quarter, which went up by Taka 7,679.52 crore or by 3.67 percent compared to the previous quarter and by Taka 31,582.50 crore or by 17.05 percent compared to the corresponding quarter of the preceding year.During the April-June period, the total deposits in the banking industry reached Taka 2,24,757.80 crore, which increased by Taka 9,199.87 crore or by 4.27 percent compared to the previous quarter and by Taka 25,332.90 crore or by 12.70 percent compared to the corresponding quarter of the last year.The Investment-Deposit Ratio (credit-deposit ratio in conventional sense) reached 0.96 in April-June quarter which was 0.97 in the previous quarter of 2018 and 0.93 at the end of June 2017.The total remittances mobilized by the Islamic banking sector stood at Taka 11,461.90 crore at the end of April-June 2018 quarter, which was higher by Taka 2,421.94 crore or by 26.79 percent compared to the previous quarter as well as higher by Taka 2,595.08 crore or by 29.27 percent compared to the corresponding quarter of the preceding year.The number of branches of Islamic banking sector including Islamic branches or windows of conventional commercial banks stood at 1,178 at the end of the April-June quarter while there were 1,169 branches during the previous quarter and 1,112 during the corresponding quarter of 2017.After analyzing the sector-wise investments, it is observed that investment in the trade and business sector was 31.25 percent, which was the highest among all sectors at the end o f April-June quarter, 2018.The next position was occupied by industrial sector, which stood at 27.42 percent followed by Micro Small and Medium Enterprises (MSME) (24.69 percent), others (6.49 percent), real estate (6.27 percent), agriculture (1.54 percent), transportation (1.39 percent), electricity, gas and water supply (0.87 percent) and poverty alleviation (0.09 percent).